A report recently published by Yankee Group concludes that, because iPhone customers are considerably more loyal than Android device buyers, Apple will beat its largest competitor in market share by 2015--and that the advantage will benefit the iPad as well.

The Yankee Group recently put out a study concluding that iPhone market share will dominate Android within two years.

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A report recently published by Yankee Group concludes that, because iPhone customers are considerably more loyal than Android device buyers, Apple will beat its largest competitor in market share by 2015--and that the advantage will benefit the iPad as well.

That's an interesting argument, one that John Gruber calls a "bold projection" to make. Apple has always focused on profit share over market share, but it's certainly not going to complain about dominating a market, either. Still, some recent reports have seemed to indicate that Android is gaining in popularity as iPhone slips.

Now, I'll be honest: Many of us feel wary when we see reports like these. Good analysts can seemingly make the numbers say anything if they work them hard enough. And for every report that says Company X is "winning"--as defined by some arbitrary metric--there's another that says that Company Y is in fact the victor, and that Company X isn't worth the dirt that used to muck up your computer mouse, back when it actually had a little ball in there. So what are we to make of this latest report?

Intent to buy what?

Yankee Group's report, prepared by analyst Carl Howe, looks at a number of different factors in the mobile market. For example: Intent to buy. Howe reports that--despite favorable press for the Galaxy S4--"consumer intent to buy Samsung phones is less than half that of iPhones in the U.S. In fact, iPhone intent to buy is statistically tied with the intent to buy all Android phones combined."

Galaxy S4

That's a big statement. If more people intend to buy iPhones than to buy Samsung phones, and if customers are effectively evenly split on whether they want to buy an iPhone or any Android phone, then it's clear that Apple is sitting pretty. The question you might ask, though, is how the heck do you measure intent to buy?

In the report, Howe explains that the data comes from two primary sources. The first source is 16,000 consumer responses to a survey it conducted "during the past 12 months," released this past March. As part of that survey, customers were asked which smartphones they own and which they intended to buy within the next six months. The study coupled that data with Yankee Group's North America Mobile Carrier Monitor, March 2013, which estimated smartphone shipments by OS and brand among U.S. carriers.

One red flag at this point is obvious: If the study includes consumer surveys from the past 12 months, then the vast majority of survey respondents couldn't comment on the Galaxy S4, which was released in March of this year. So when the study says that customers don't want to buy Samsung phones, despite S4's generally positive press, it's being a little cute. The numbers would seem to speak to customer sentiment regarding pre-S4 Samsung phones in general, with the S4 itself being unable to influence data gathered before its launch.

When I asked Howe about that, however, he maintained--while agreeing with my hypothesis that the report didn't really include customer feedback on the S4--that this itself was an important data point. "Six months before the iPhone 5 was launched," Howe said, "we saw a bump of roughly six to eight points" on the intent-to-buy metric.

In other words, customers knew they wanted the iPhone 5 even before it was officially available. In theory, customers should have anticipated a new Samsung Galaxy S phone was coming. But, Howe said, "we didn't see that bump with the S4." He concludes that customers either weren't excited about the S4, weren't anticipating it, or didn't even care enough to anticipate it.

A second potential red flag is less obvious, but Yankee Group acknowledges it in the report itself: It warns that the model used in the study "assumes consumer brand preferences and intent to buy remain constant through the range of the forecast, but actual consumer behavior is likely to change during the coming years." The survey's predictions, then, should be read "as a forecast of how markets will evolve unless smartphone products and carrier offerings persuade consumers to buy different products than they intend to buy today."

Okay then. So Yankee Group is seemingly predicting precisely how the smartphone market will look going forward, unless anyone makes a new and compelling phone or offer. Isn't that sort of like predicting that a single man who orders pizza today will eat leftover pizza tomorrow, unless he sees there's a good deal at the Chinese food place that day?

By the numbers, if you buy the numbers

Yankee Group says that just nine percent of iPhone owners "plan to switch to another platform with their next phone purchase, while 24 percent of Android owners plan to defect from the Android platform." And 18 percent of Android owners plan to switch to the iPhone, specifically. If you accept those numbers, that means that nearly three times as many Android owners plan to abandon their phone platform, compared to iPhone owners.

iPhone 5

Howe obviously thinks you should accept the numbers.

"If this were a sample of a few hundred people," you could reasonably conclude that the data could be easily swayed by just a few outliers. "But this is a big survey--16,000 people. Each respondent is basically representing a few million folks. There are literally millions of people making these decisions about what they're going to buy. It's kind of hard to get it grossly wrong."

In fact, when I mentioned Gruber's description of the study's conclusions as "bold," Howe didn't quite agree, "because moving the needle on ownership--what phone you own--takes years." Because of carrier contracts, Howe pointed out, "even if people stop buying iPhones tomorrow, that number doesn't go to zero for at least two to three years. The ownership numbers are very, very hard to move." Couple deeply entrenched iPhone ownership with high Apple customer loyalty and one in four Android users looking to switch, Yankee Group concludes, and the iPhone's market share dominance is assured.

Bold or unbold

So Howe doesn't think his prediction--that iPhone market share will outshine Android's in 2015--is bold at all. For his prediction to come out wrong, a lot of things would have to happen: "Consumer buying intent would have to change dramatically, [iPhone] sales would have to crater really fast, and loyalty would have to change dramatically"--Android's going up, Apple's going down.

"The reason I feel so confident about this is simple," Howe said. "Large samples make your life pretty easy."

But Howe isn't surprised that some people are surprised by conclusions he considers obvious. "We're fighting 30 years of experience." Not long ago, he explains, very few people made buying decisions for the tech industry; getting 20 large buyers to change their mind was enough to significantly rehsape market leaders. So an upstart needed only to convince those 20 large buyers, and the market share picture could change almost literally overnight.

It's different now. Today, most of us buy our own tech gear, especially our smartphones. That means companies need millions of customers to switch to their product, not just an elite handful of buyers. And, Howe says, "Convincing millions of people to change their mind--that takes work."

Samsung's focusing on the right places, Howe said: brand-building and advertising. Though Samsung is now pursuing it, "they still don't have stores--and that takes about a decade to really get going. So we can check back in 2023."

He added: "Brand-building is a process that takes decades." Apple's been great at it, and the Apple Stores are, of course, a huge success. "It's just so hard to move consumer sentiment," he said, adding that that's what confuses many Wall Street investors. "A hot phone won't do it."

Customers are also concerned about avoiding buyer's remorse, with what Howe called "the nasty problem" of two-year contracts: "If I buy my $200 iPhone 5 and I don't like it, switching to an Android phone now costs me $600." That, Howe said, makes customers especially risk-averse. "If you get beyond the return period, you're stuck with your mistake for two years."

And today, "if you want a phone and you don't want to worry about whether it'll have apps or the right features, the iPhone is the safe choice for folks. So the likelihood that they're going to switch is very small," Howe said.

App buy-in helps, too. "It's getting more expensive to switch." Once you've spent real money in the App Store, "you're invested in the ecosystem," Howe said. Most customers don't want to buy their apps all over again--or miss out on getting the apps they like that aren't available on Android.

You might say that time will tell whether Yankee Group's predictions will prove true. But Howe's convinced that the statistics already make his case today.